Auto stocks gain on robust July sales

Auto stocks gain on robust July salesShares of auto companies rallied in the domestic equity market on Tuesday after posting robust sales numbers for July. The S&P BSE Auto index rose as much as 1.1 per cent in morning trade and was top sectoral gainer on the Bombay Stock Exchange (BSE).

A recovery in consumer demand and hope of above-average monsoon rains helped drive strong sales of automobile companies in July.

Continuing the rally for the second straight day, India's leading carmaker Maruti Suzuki India rose as much as 2.15 per cent to Rs 4974.40 apiece during morning hours. Among others, Tata Motors gained as much as 0.6 per cent, Mahindra and Mahindra 1.3 per cent and TVS Motor 1.7 per cent.

At 11:10 am, the S&P BSE Auto Index was trading at 21,371.06 points, up 0.85 per cent from its previous close.

In fact, segment leaders like Maruti Suzuki, Tata Motors and Hero MotoCorp have reported de-growth of 34.3 per cent, 45 per cent and 20 per cent, respectively giving a clear indication of a prolonged slowdown in the sector.